Managing the professional risks of growth within your small business
October 06, 2011
Entrepreneurs and CEOs of small firms are shrugging off the growing economic headwinds and are hunting for new talent to help grow their businesses.
A survey of entrepreneurs found that 96% of them were planning to take on more staff in 2012; 41% said they plan to hire more than 20 new employees next year, according to a poll carried out at the recent Inc 500/5000 Conference.
That’s great news, because the economy is only going to really get motoring when small firms start hiring again. That’s because they employ around half of all US workers and small businesses have generated 65% of net new jobs over the past 17 years, according to government statistics.
But expanding a small business also brings new risks. There’s the chance that your growth plan hits the skids because customers get spooked by the gloomy conditions and decide to keep their money in their pockets. And you need to look at the professional liability insurance exposures that come with adding employees or contractors.
That’s because there’s the risk that one of your new hires makes a blunder that winds up costing your firm a lot. You may have chosen to use a subcontractor or a temp to trim expenses, but you may still be on the hook if they slip up. The legal bills and compensation resulting from their gaffe could cost you much more than you had saved by not making a permanent hire.
That’s why it’s important to have a good professional liability insurance policy. You can get one that covers you for work done in the past, back to an agreed date (usually when your business started), so even if that employee has left your business you can be covered for their mistakes. Professional liability insurance coverage can also be tailored to cover all your staff: full-timers, part-timers, your temps and sub-contractors too.
It’s great to be a job creator, but don’t forget to be a risk manager also. Nobody wants to see any more small businesses go under – particularly those with ambitious plans to grow. Make sure your covered with the right small business insurance.